An independent Scotland would need to cut spending, delay launching its own currency and offer tax cuts for migrants, a long-awaited Scottish National party report has said.

The sustainable growth commission report warns that Scotland would need “robust” controls on public spending in the first five to 10 years after independence to cut the country’s large deficit to less than 3% of day-to-day spending.

The paper, commissioned by Nicola Sturgeon, argues that Scotland should aspire to match the economic growth of other small wealthy nations, such as Denmark or Finland, but cautions that it could take a generation to do so.

The most recent official figures show that in 2016 the Scottish and UK governments spent £13.5bn more on public services than were raised by taxes in Scotland, and was subsidised by taxpayers elsewhere in the UK.

The 354-page analysis says Scotland’s faltering economy should be boosted by a “come to Scotland” campaign, offering tax relief for new migrants and foreign students who stay to work, and lower financial thresholds for companies investing there.

Despite months of speculation that the commission would suggest a new currency, the report says an independent Scotland should keep sterling for an indefinite period, delaying its own currency to “some future date”.

The commission was chaired by Andrew Wilson, a former SNP MP and economist who is now a highly influential lobbyist, after Sturgeon opted for a far more candid assessment of the economics of independence than that offered by her predecessor, Alex Salmond.

Richard Leonard, the Scottish Labour leader, said the recommendation to cut the deficit by nearly two thirds in under a decade and the decision to use the pound without being able to set UK monetary policy would be disastrous for Scotland.

“These plans would leave an independent Scotland as a rule taker not a rule maker. The SNP is proposing a decade of unprecedented austerity and no control over the value of their wages, rent and mortgages,” he said.

Salmond’s white paper before the 2014 independence referendum forecast global oil prices would stick at around $120 a barrel. He said oil would produce tax revenues as high as £7.9bn in 2016, allowing heavy investment in the economy and services.

Instead, oil prices plunged to as low as $35 a barrel in 2016, cutting oil revenues to the second lowest figure on record to just £208m. The deficit that year was equal to 8.3% of overall spending, more than three times higher than the 2.4% deficit for the UK as a whole, and one of the largest in the EU.

Public spending in Scotland was £1,437 per person higher than the UK average of £11,739 in 2016, and the country’s economic growth remains a point lower than the UK average, expanding at just 0.75% last year.

Among 50 recommendations making the case for an “inter-generational economic renaissance”, the report says the country should:

• Invest heavily in exports and productivity, which are currently lower than UK rates
  
• Aim to match the 2.5% growth rate of other small rich countries within 10 years
• Aim to cut poverty rates by 50% for the poorest 10%
• Set up a “windfall fund” with any revenues from asset sales and any taxes from oil revenues
  
• Set up a new currency only after six economic tests are met, including fiscal stability and sufficient reserves
  

Sturgeon, who opted not to host a press conference or any public event to release the Wilson report, has instead set up “national assemblies” over the summer so SNP members can discuss its findings before this October’s annual party conference.

In her foreword to the report, Sturgeon said it did not shy away from the scale of the country’s challenges, but she insisted she was optimistic about the opportunities that independence would bring.

“It is not a report about the timing of a referendum – rather, it focuses on the ‘why’ of independence and how we can use the powers it will deliver to build a stronger economy and a fairer society,” she said.

“In so doing, it heralds the start of a debate based on hope and ambition about the future of the country, rather than on the despair of Brexit.”

David Mundell, the Scottish secretary for the UK government, said Sturgeon was again ignoring the vote against independence in 2014. She should instead try to make Brexit a success. “That decision should be respected. The public do not want another divisive independence referendum,” he said.